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Jim O'Neill

Will inflation turn COVID-19 boom to bust?

The rebound from the temporary lockdowns was always going to be strong. But if inflation comes roaring back the good news will prove fleeting.

For much of the past year, I have argued that a cyclical economic recovery from the COVID-19 disruption would be stronger than most people expected.

In offering that outlook, my emphasis was on the cyclical (rather than structural) nature of the crisis: the lockdowns were always going to be temporary; safe and effective vaccines have been brought to market with unprecedented speed; and governments have duly responded to the shock with massive levels of monetary and fiscal stimulus.

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Jim O’Neill was chairman of Goldman Sachs Asset Management and former commercial secretary to the UK Treasury.

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    Original URL: https://www.afr.com/policy/economy/will-inflation-turn-covid-19-boom-to-bust-20210413-p57iuw